U.S. v. Puente

• Court: Court of Appeals for the Fifth Circuit
• Decided: January 21, 1993
• Docket: 92-8084
• Status: Published

Opinion

IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

_____________________

No. 92-8084 _____________________

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

versus

ROBERTO PUENTE, JR.,

Defendant-Appellant.

_________________________________________________________________

Appeal from the United States District Court for the Western District of Texas _________________________________________________________________

(January 21, 1993)

Before KING, JOHNSON, and DUHÉ, Circuit Judges.

JOHNSON, Circuit Judge:

Following a bench trial, Roberto Puente, Jr. was convicted

of making a false statement to a government agency in violation

of 18 U.S.C. § 1001. Puente raises two arguments on appeal.

Puente argues first that the government did not carry its burden

of proving the elements of a § 1001 violation, and second that

his conduct fell within the "exculpatory no" exception to § 1001.

Finding no error, this Court affirms the judgment of the district

court.

I. Facts and Procedural History

Puente and his father were two of the principal officers of Eagle Contractors, Inc. In their capacity as company officers,

they submitted a bid on the renovation of a housing project in

Eagle Pass, Texas. The project was partially administered and

funded by the U.S. Department of Housing and Urban Development

(HUD). The bidding process required that the parties fill out a

"Prior Participation Certification" form documenting their prior

involvement with federal building projects. By signing this

form, the parties also certified that they had never been

convicted of a felony. Puente and his father both signed the

form despite the fact that each had a previous felony conviction.

At a public board meeting held for the purpose of

recommending acceptance of a bid, John Melton, who was in charge

of the project for HUD, recommended that Eagle Contractors be

awarded the project. Melton was then informed of the Puentes'

felony convictions by another board member. Melton later

investigated this allegation and obtained documentation

confirming that both Puente and his father had previously been

convicted of a felony. However, there is no HUD rule that

prohibits convicted felons from being awarded government

contracts, and Melton continued to recommend that Eagle

Contractors be awarded the contract.

Though Melton still favored Eagle Construction, he provided

the information concerning the Puentes' misrepresentations to the

legal counsel for HUD. After a review of the documents submitted

by the Puentes, HUD officials determined that Puente and his

father had actually signed a reduced copy of the previous

2 participation form that had been provided in the project manual.1

This form was very difficult to read, and HUD officials

recognized that Puente and his father might have misunderstood

the certification requirements. Melton was instructed to give

the Puentes a chance to sign the full-size form at a

preconstruction meeting. Without mentioning his investigations

or specifically pointing out the certification requirement,

Melton asked the Puentes if they had read the form and were

willing to sign. After they signed the form, HUD officials

rejected their bid and awarded the project to the number two

bidder.

Puente and his father were subsequently charged with

violating 18 U.S.C. § 1001 which makes it a crime to knowingly

and willfully misrepresent a material fact in a matter within the

jurisdiction of a department or agency of the United States.

Following a bench trial, Puente was convicted, and his father was

acquitted. Puente now appeals.

II. Discussion

A. Sufficiency of the Evidence

A violation of 18 U.S.C. § 1001 requires five elements: "(1)

a statement, that is (2) false (3) and material, (4) made with

the requisite specific intent, [and] (5) within the purview of

government agency jurisdiction." United States v. Lichenstein,

1 The actual HUD form measures 11 x 14 inches. The form included in the project manual had been reduced to 8.5 x 11 inches.

3 610 F.2d 1272, 1276 (5th Cir.), cert. denied, 447 U.S. 907

(1980). Puente argues that the prosecution did not satisfy its

burden of proof for two of these elements--specifically

materiality and intent.

In reviewing the sufficiency of evidence for a bench trial,

this Court applies a substantial evidence standard. United

States v. Jennings, 726 F.2d 189, 190 (5th Cir. 1984). The

question before this Court is whether, when viewing the evidence

in the light most favorable to the government, the evidence is

sufficient to justify the trial judge, as trier of the facts, in

concluding beyond a reasonable doubt that the defendant was

guilty. United States v. Richardson, 848 F.2d 509, 511 (5th Cir.

1988).

1. Materiality

A material statement is one that has "a natural tendency to

influence, or [one that is] capable of affecting or influencing,

a government function." United States v. Swaim, 757 F.2d 1530,

1534 (5th Cir.), cert. denied, 474 U.S. 825 (1985). Actual

influence or reliance by a government agency is not required.

The statement may still be material "even if it is ignored or

never read by the agency receiving the misstatement." Id.

(quoting United States v. Diaz, 690 F.2d 1352, 1358 (11th Cir.

1982)).

Puente argues that his certification was not material

because a bidder can still be awarded a contract even if he has

been convicted of a felony. Previous case law makes it clear,

4 however, that the standard for a § 1001 violation is not whether

the false statement actually influenced a government decision or

even whether it probably influenced the decision; the standard is

whether the misrepresentation was capable of influencing the

agency decision. In this case, the stated purpose of the

Previous Participation Certification is to allow HUD "to

determine if [the bidder] meet[s] the standards established to

ensure that all principal participants in HUD projects will honor

their legal, financial and contractual obligations and are

acceptable risks from the underwriting standpoint of an insurer,

lender or government agency." By signing the Previous

Participation Certificate, Puente provided HUD with information

in a number of areas that could be relevant to any agency

decision on whether to approve a bidder's participation in a

government project. In addition to certifying that he had never

been convicted of a felony, Puente also certified that no

mortgage on any of his previous projects had ever been in

default; that there were no unresolved findings raised by

government audits or investigations of his previous projects;

that he had not been suspended or disbarred from doing business

with any government agency; and that he had never defaulted on an

obligation covered by a surety or performance bond. While it may

be true that Puente would have been awarded the contract even if

he had answered truthfully, his misrepresentation deprived HUD of

the opportunity to determine, based upon all relevant

information, which bidder was best qualified to complete the job.

5 Because HUD officials could have viewed the bid differently if

Puente had answered correctly, the district court did not err in

holding that Puente's misrepresentation was "capable of affecting

or influencing" the agency decision.

2. Intent

A conviction under § 1001 requires proof that a defendant

had the specific intent to make a false or fraudulent statement

"deliberately or at least with reckless disregard of the truth

and with the purpose to avoid learning the truth." United States

v. Tamargo, 637 F.2d 346, 351 (5th Cir.), cert. denied, 454 U.S.

824 (1981). In this case, Puente claims that he never read the

HUD form, and the prosecution introduced no evidence that showed

that Puente knew what he was signing. Instead, the district

court concluded that, by signing the form without reading it,

Puente acted with "a reckless disregard of the truth and with the

purpose to avoid learning the truth."

This Court finds no error in the district court's judgment.

"Reckless indifference" has been held sufficient to satisfy §

1001's scienter requirement so that a defendant who deliberately

avoids learning the truth cannot circumvent criminal sanctions.

See United States v. Schaffer, 600 F.2d 1120, 1122 (5th Cir.

1979). Likewise, a defendant who deliberately avoids reading the

form he is signing cannot avoid criminal sanctions for any false

statements contained therein. Any other holding would write §

1001 completely out of existence.

6 B. The "Exculpatory No" Doctrine

Puente's final argument is that his false statement falls

within the "exculpatory no" exception to liability under § 1001.

The "exculpatory no" doctrine exempts "mere negative responses"

to questions posed by investigating agents from the reach of §

1001. Paternostro v. United States, 311 F.2d 298, 305 (5th Cir.

1962); see also United States v. Berisha, 925 F.2d 791, 796 (5th

Cir. 1991). The doctrine originates, at least in part, from a

"latent distaste for an application of [§ 1001] that is

uncomfortably close to the Fifth Amendment." United States v.

Lambert, 501 F.2d 943, 946 n.4 (5th Cir. 1974) (en banc). Puente

argues that his signature on the full-size form was exculpatory

because he had already signed the reduced form; if he had refused

to sign the second form he would have incriminated himself by

taking an inconsistent position.

Whatever the merits of this argument, Puente did not raise

it before the district court. When reviewing a theory raised for

the first time on appeal, this Court applies a "plain error"

standard and only reverses errors of a nature that they would

result in a miscarriage of justice if not remedied. United

States v. Young, 470 U.S. 1, 15-16 (1985); United States v.

Contreras, 950 F.2d 232, 239 (5th Cir. 1991), cert. denied, 112

S.Ct. 2276 (1992). Puente's "exculpatory no" argument simply

does not rise to this level.

III. Conclusion

For the reasons stated, this Court holds that the evidence

7 was sufficient to sustain Puente's conviction for a violation of

18 U.S.C. § 1001. Also, we hold that it was not plain error for

the district court to acquit Puente under the exculpatory no

doctrine. Accordingly, the judgment of the district court is

affirmed.